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Stacey Guerin represents District 10 in the Maine Senate.
The recently enacted American Rescue Plan established a $28.6 billion Restaurant Revitalization Fund for restaurants and other food establishments. Soon, the Small Business Administration (SBA) will begin awarding tax-free federal grants to eligible applicants.
Since Maine’s economy is so greatly dependent on tourism, this new program will be an enormous benefit to a segment of our business community that is greatly in need of relief. Applications and guidelines are expected from the SBA later this month. To give potential applicants time to prepare, here are some details about the program that may be helpful.
To qualify, a business must be an “eating establishment,” which is defined as any restaurant, food stand, food truck or food cart, saloon, inn, tavern, bar lounge or brewpub, tasting room, taproom, or any licensed facility or premises of a beverage alcohol producer where the public may taste, sample, or purchase products, or other similar place of business in which the public or patrons assemble for the primary purpose of being served food and drink.
These entities are eligible for a grant if they have incurred a “Pandemic-Related Revenue Loss” for the period beginning Feb.15, 2020, and ending Dec. 31, 2021, or a date set by the SBA, which cannot be later than March 11, 2023.
A “Pandemic-Related Revenue Loss” is gross receipts for 2019 minus gross receipts for 2020. If an eating establishment was not in operation for all of 2019 there is a formula available to calculate the grant amount.
Awards received under any other federal relief programs, such as from the Paycheck Protection Program, will affect the grant amount, which can be as high as $5 million per location and no more than $10 million overall.
Grants can be used for payroll costs, mortgage payments, rent, utilities, maintenance expenses, including construction to accommodate outdoor seating and walls, floors, deck surfaces, furniture, fixtures, and equipment. Supplies, including personal protective equipment, cleaning materials, and food and beverage expenses that are within the scope of the normal business practice of the eligible entity before the covered period are also included. As are supplier costs, operational expenses, paid sick leave and any other expenses the SBA determines to be essential to maintaining operations.
During the initial 21-day period during which grants are awarded, the SBA is required to prioritize grants to small businesses owned by women or veterans and to socially and economically disadvantaged small businesses. In addition, until May 10, $5 billion of the Restaurant Fund shall be reserved for businesses with 2019 gross receipts of $500,000 or less.
The SBA is expected to release grant applications, rules and guidance this month. During the initial 21-day period — expected to be in May and perhaps June — the SBA will begin awarding grants to small businesses owned by women or veterans and to socially and economically disadvantaged small businesses.
Grant applications will be accepted from all eligible entities later in May or June.
If you think you are eligible, you should begin pulling together the information you will need to apply and watch in the next few weeks for an announcement from the Small Business Administration with applications and guidance.